You’re considering a gift made during your lifetime > You’re holding an interest in a viable business > You want to save both income and capital gains tax
Gifts of business interests –
such as stock in a closely-held corporation, S-corporation
stock and shares in a professional corporation
– can be beneficial for both you and your
favorite charity. Business interests can be given
outright or can, in some cases, fund certain types
of life-income gifts, primarily net-income unitrusts.
Since closely-held stock doesn’t
trade publicly, a gift of such an asset requires
an independent appraisal to establish its fair
market value. Your charitable deduction will be
based on the appraised market value of the shares
minus any liabilities you may have accrued.
Because offering a charity part ownership of a business through a gift of stock involves them in issues of marketability, taxation, liability and involvement in business operations, their financial officers must first review and approve any such transfer. For your part, if you are considering a gift of a stock in a business interest, consult first with your attorney and accountant.
